On October 6, the U.S. Attorney for the Southern District of New York announced an $85 million settlement to resolve claims for civil fraud under the False Claims Act that a bank certified roughly 1,400 mortgage loans as eligible for FHA insurance, when the bank knew that the loans were in fact ineligible and failed to self-report that fact to the U.S. Department of Housing and Urban Development (HUD). As a result, FHA suffered losses of roughly $85 million on approximately 500 loans that defaulted and for which FHA paid out on the insurance claims. As part of the settlement, the bank also agreed to indemnify HUD for any future losses should any of the remaining 900 loans default and result in claims, and to pay HUD a $2 million administrative payment as part of the indemnification agreement. The bank admitted that it was required to self-report any serious deficiencies in the underwriting of FHA loans to to HUD within 60 days of discovery, that it identified 1,436 residential mortgage loans with such deficiencies through post-closing reviews, and that it failed to timely report these defective loans. The case began, in part, due to the filing of a whistleblower complaint under the False Claims Act, although the bank made a voluntary disclosure to the government without knowledge of that complaint. The government intervened in the whistleblower suit to reach this settlement.